"The lower average valuations are the result of a changing mix of successful growth-oriented acquisitions and the exits of challenged companies," said the NVCA’s John Taylor. Translation: VC’s had fewer attractive properties to sell, and more unattractive ones. Thus, the lower number of deals and the lower average value per deal.

Software company M&A accounted for about 40% of the last quarter’s VC deal dollar value, the largest single sector.